Pay For Performance:The Evolution of the Marketing Budget
Our revolutionary pricing model is simple:
We charge a small Monthly Retainer to cover our basic hard costs, plus a monthly Performance Bonus based on the REAL RESULTS we produce for you.
A little background...
For years, like virtually every other marketing agency did (and still does), we charged a flat-fee, monthly retainer for our services. But this model had drawbacks for both our clients and ourselves. We've produced some amazing results for our clients over the years but, because marketing can never 'guarantee' sales (we can't force people to buy from you), we also had occasional campaigns that simply didn't produce a significant return on investment for our clients, despite our best efforts (and you should be wary of any marketer who claims they've never had a campaign that failed to generate a positive ROI).
On the other hand, we've run campaigns that generated an ROI many times the cost of our retainer, which left us feeling like we undercharged and were undervalued. We needed to find a pricing model that was fair for everyone and grounded in real results, not just activities.
Ultimately, we came to the understanding that the best pricing model would be one in which both parties have skin in the game, and are incentivized to succeed. We needed to create a new pricing model in which the more money we help our clients make, the more money we make.
Here's how we arrived at a balanced solution:
From our perspective, in a perfect world, we would charge you a huge monthly retainer, regardless of the results we produce, and you would happily pay it month after month. We wouldn't have to worry about whether or not you are making money, and we'd have perfectly predictable revenue for our own business... Clearly, this model is completely unfair to you, yet that's exactly how the vast majority of agencies charge.
From your perspective, in a perfect world, you wouldn't pay a dime for marketing services until you actually made a sale, and that marketing cost would come out of each sale’s revenue. In this scenario, you would have no risk and no upfront cost. In other words, you'd get to pay 'after the fact', out of money you’ve already made, for the marketing services that generated that sale.
Of course, that’s also unrealistic, because a marketing agency is a business also, with hard costs like software, payroll and overhead to create and run your campaign, and we can’t guarantee you sales or force customers to buy from you. We can hand you laser-targeted, super-qualified, high-value leads on a silver platter but, in that scenario, once a great lead is in the hands of your sales team, we would have done an excellent job on our end, but our compensation would then become dependent on your sales team's efforts... which is out of our control.
Our small Monthly Retainer ensures that you have some skin in the game, and the Performance Bonus ensures that we also have skin in the game. This approach incentivizes us to produce the very best results possible for you.
So do we charge per lead?
No. It’s important to distinguish Pay For Performance (PFP) marketing from Pay Per Lead (PPL) marketing. Some marketers charge for every lead generated or every action taken by a prospect, such as filling out a form on your website or clicking on one of your ads. Pay Per Lead models don’t take into account the 'quality' of the leads, and can quickly add up to big costs for you, with little or nothing to show for it.
Our goal with each campaign is quality over quantity and long-term relationships with our clients that are highly profitable for everyone. We’re not interested in billing you for piles of mediocre leads, only to have you quickly end the relationship disappointed.
Instead, we collect a Performance Bonus when a lead that we've generated for you advances all the way to a proposal or estimate. In other words, even if a prospect is a good fit for your services or products, and expresses interest, it's not until you give them a proposal or estimate (depending on your terminology) with an actual dollar amount attached to it that we collect our Performance Bonus.
If you'd like to get more details on our pricing and learn how we can help your business grow, the next step is to tell us a little about your business and find out if there's a mutual fit. Just click the pink button below and answer a few questions - We'll look forward to meeting you.
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